Caught this recent comment about my book Trend Commandments:
“I’ve found Covel’s previous books interesting, and have re-read ‘Trend Following’ multiple times. The latest book unfortunately does nothing to build on the previous works (for instance, there is still no attempt to deal with survivorship bias in the performance data), but instead loads the pages with random anecdotes and film quotations that tangentially supports his thesis. Disconcertingly, what the book lacks in substance is made up for in ego. If you’re not with him, you’re against him and a moron. Successful value investors? Don’t exist (sorry Mr. Buffet, you made your money through luck and speculating with derivatives). Covel admonishes the world for ‘going with the herd’… ummm… isn’t following a trend exactly that? Too light on science, way too light on humility.”
That is going in verbatim to the chapter titled Honest on next printing. It does make my Sunday morning that a critic calls himself a moron before I can. One definition of survivorship bias?
“Survivorship bias is the logical error of concentrating on the people or things that “survived” some process and inadvertently overlooking those that didn’t because of their lack of visibility.”
Trend Commandments in its entirety addresses this very issue–for those with their eyes wide open. However, for the critics that need to blow off steam an excerpt from the ‘Trend Commandments’ chapter ‘Honest’ may be helpful:
Some will never know and will rip [Trend Commandments] as well. A famed Stanford University psychologist has said that a man with a conviction is a hard man to change. Tell him you disagree and he turns away. Show him facts or figures and he questions your sources. Appeal to logic and he fails to see your point. Now I could very easily avoid criticism, do nothing, say nothing, and be nothing, but quitting is not in my DNA. However, criticism is important and often invigorating for many reasons:
- You are on the right track when a target appears on your back.
- Making a sizable dent in public thought brings detractors and saboteurs. It’s part of doing business.
- Trying to get everyone to like you is mediocrity.
- You are going to be criticized if you play small or play big. Might as well play big. Criticism will come either way.
- History does not remember those who pretend to be neutral. Picking sides, choosing those you want to be associated with, and sticking with your true beliefs is all that counts.
- Speaking out on issues, that others are too afraid to do, will draw criticism.
- Disgruntled people need to release anger. Standing there as an easy outlet for their anger is part of the gig. Criticism always parallels influence.
- It takes courage to see things for what they are, not what you want them to be.
- Poking an inferiority complex brings out vitriol–always.
Society’s insatiable push to discredit those who rock the boat, coupled with digital printing presses cataloging it all, has allowed village idiots and Nobel Prize winners to effectively share the same stage. In this environment, for many, the truth has ceased to matter.
“An outstanding book [Trend Commandments] for anyone who wants to become rich by trading markets. Today, government regulations and fiscal and monetary policies are badly distorting financial markets. Covel accurately explains why, in this ‘manipulated’ financial environment, you should never expect markets to move as you wish or expect. Rather, disregard your fundamental beliefs and simply follow the trend. Highly recommended!”
Managing Director, Marc Faber Ltd.
Editor, ‘Gloom Boom & Doom Report’
“If you are even thinking of a career in trading, put down all the other books. Buy this one [Trend Commandments]. Read it. Now you can start your career.”
Managing Director, Formula Capital
“Fire up the barbecue. Michael Covel skewers the sacred cows of Wall Street with tasty bite-sized bits of the truth about what it really takes to succeed in trading and life. Wide-ranging, irreverent, revealing, eminently quotable, and right on the money.”
Market Wizard Trading Coach
“A rapidly moving, non-technical, and outside-the-box effort that smartly captures the essentials of trend following.”
Chairman and CEO, Computer Trading Corp
“Michael Covel’s Trend Commandments is full of practical wisdom in bite-size portions on the benefits of trend trading–written in a straightforward storytelling format. It’s definitely one to add to your financial bookshelf.”
Signal Financial Group
“Michael Covel is the very best at explaining the concepts of successful trend following in plain English. I’m certain you’ll be a successful trader if you follow the ideas he outlines in Trend Commandments. This book (and his previous two!) are required reading for new employees in my office.”
“Investors have experienced two bear markets in the last decade. This has led to rising volatility, uncertainty, and investor angst. For some it has been a lost decade, but for trend traders it has been a decade of opportunity. Trend Commandments helps you focus on what matters most: the trend of the markets, whether up or down. You can profit from either. Trend Commandments is essential reading for those who have the desire to thrive and survive in an era of fast-paced trending markets.”
CEO, Chief Investment Strategist, PFS Group
“Buy and hold has been a difficult investment system for investors for a decade. In Trend Commandments, Covel challenges readers to think differently and question their beliefs about market ‘truths’ ingrained in them for years. Forewarned, you just may never see the world the same way again.”
Cambria Investment Management
“Covel’s Trend Commandments offers a breezy rumination on what is right about trend following and what is wrong about conventional trading approaches.”
Author of Market Wizards and Schwager on Futures series